What makes management consultants different from an ordinary filing?
Consultants furnishing services in a country for an extended period can create a service permanent establishment for their firm, and several treaties — India's among them — apply that test at a low threshold. An ordinary preparer applies the general rule and stops there, which is how the relief in the specific provision goes unclaimed.
Can you work with my existing accountant?
That is how most of these engagements run. They keep the domestic file, we take the cross-border piece, and the boundary is agreed in writing so nothing is done twice or missed.
Why is tax filing harder for consultants who travel constantly?
A consulting engagement that moves you between client sites in different countries can create a filing obligation in each place you work, not just where your employer is based or where you live. Income sometimes has to be apportioned by where the work was physically performed, and a home country return still has to account for everything earned abroad. We start by mapping where the work actually happened over the year, because that record is what both countries' returns rely on.
Could working on-site abroad create a tax bill there too?
It can. Time spent physically working in a client's country, rather than where your employer or firm is headquartered, is often what triggers a local filing obligation, and repeated short trips can add up to a presence that a single visit would not. We assess where the engagement work is actually carried out, not just where the contract is signed, before deciding whether a return is owed in that country as well as your home one.
How do you determine which country taxes a given assignment?
We start from a record of where the work was physically done — client site, home office, or another location — because presence and source of payment, not the consultant's home address, generally decide which country has the first claim to tax that income. From there we work out what your home country's return needs to reflect and where a foreign tax credit or treaty position applies, so the same work is not taxed twice without relief.
Do Canada and the United States share tax information?
Yes, through more than one channel. The treaty has an exchange-of-information article that supports both routine and on-request exchange. Separately, an intergovernmental agreement has Canadian financial institutions identify US-reportable accounts and report them to the CRA, which passes them to the IRS, with the reverse flow for Canadian residents. Most other country pairs use the Common Reporting Standard for the same purpose. See FATCA reporting.
Is "fund transfer pricing" the same thing as transfer pricing?
No — and if you came here to calculate FTP, this is not it. Fund transfer pricing is a bank's internal allocation of funding costs and benefits between its own business units, a treasury and asset-liability management discipline used to measure branch or product profitability. Tax transfer pricing is about prices between legally separate related parties across borders, and about which country taxes the resulting profit. The words overlap; the fields do not. See our transfer pricing work.
